On March 1, 2022 Precigen, Inc. (Nasdaq: PGEN), a biopharmaceutical company specializing in the development of innovative gene and cell therapies to improve the lives of patients, reported fourth quarter and full year 2021 financial results (Press release, Precigen, MAR 1, 2022, View Source [SID1234609251]).
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"In 2021, Precigen was able to demonstrate significant progress in our core therapeutic platforms with indicators of strong early efficacy and favorable safety profiles across each of our most clinically advanced assets," said Helen Sabzevari, PhD, President and CEO of Precigen. "As we advance assets with the most promising paths to licensure, we will continue to focus on strengthening our financial position by continuing to ensure operational efficiency while seeking strategic non-dilutive funding opportunities where appropriate."
Key Business Highlights
Public Offering: In January, Precigen closed a public offering of 17,250,000 shares of common stock, which resulted in gross proceeds to Precigen of approximately $129.4 million before deducting the underwriting discount and other offering expenses payable by Precigen;
PRGN-3006 UltraCAR-T in Acute Myeloid Leukemia (AML): In 2021, enrollment in the dose escalation phase of the Phase 1/1b PRGN-3006 UltraCAR-T clinical trial for the treatment of patients with relapsed or refractory AML or higher-risk myelodysplastic syndromes (MDS) was completed for both the lymphodepletion and non-lymphodepletion cohorts. Interim data for patients treated in Dose Levels 1-3 of the non-lymphodepletion cohort and Dose Levels 1-2 of the lymphodepletion cohort were presented at the 63rd American Society of Hematology (ASH) (Free ASH Whitepaper) Annual Meeting and Exposition in December 2021;
PRGN-3005 UltraCAR-T in Ovarian Cancer: In 2021, enrollment in the dose escalation phase of the Phase 1/1b clinical trial for the treatment of patients with advanced, recurrent platinum-resistant ovarian cancer was completed for both the intraperitoneal (IP) and intravenous (IV) arms. Interim data for patients treated in Dose Levels 1-3 of the IP arm were presented at the Company’s 2021 research and development (R&D) Virtual Event in November 2021;
PRGN-3007 Next Generation UltraCAR-T with Intrinsic PD-1 Inhibition: In 2021, Precigen received investigational new drug (IND) application clearance from the US Food and Drug Administration (FDA) to initiate a Phase 1 study of PRGN-3007 UltraCAR-T in advanced receptor tyrosine kinase-like orphan receptor 1 positive (ROR1+) hematological tumors, including chronic lymphocytic leukemia (CLL), mantle cell leukemia (MCL), acute lymphoblastic leukemia (ALL) and diffuse large B-cell lymphoma (DLBCL) and solid tumors, including triple negative breast cancer (TNBC). An abstract highlighting PRGN-3007 preclinical data was presented as a poster presentation at the 63rd ASH (Free ASH Whitepaper) Annual Meeting and Exposition in December 2021;
PRGN-2012 AdenoVerse Immunotherapy in Recurrent Respiratory Papillomatosis (RRP): In 2021, Precigen received IND clearance from the FDA to initiate a Phase 1 study of PRGN-2012, an off-the-shelf (OTS) AdenoVerse immunotherapy, in patients with RRP and began dosing patients in the study. Precigen completed enrollment in the Phase 1 dose escalation and expansion cohorts. Interim data for the Phase 1 study were presented at the Company’s 2021 R&D Virtual Event in November 2021;
PRGN-2009 AdenoVerse Immunotherapy in HPV-associated Cancers: In 2021, Precigen completed enrollment in the PRGN-2009 Phase 1 monotherapy arm and enrollment is ongoing in the Phase 1 combination arm of the study. The Phase 2 monotherapy arm in newly diagnosed oropharyngeal squamous cell carcinoma (OPSCC) patients is also ongoing. In November 2021, interim data for patients in the Phase 1 monotherapy and combination arms were presented at the Company’s 2021 R&D Virtual Event and Society for Immunotherapy of Cancer (SITC) (Free SITC Whitepaper) 2021 Annual Meeting; and
AG019 ActoBiotics in Type 1 Diabetes (T1D): In 2021, Precigen completed the Phase 1b/2a AG019 ActoBiotics clinical trial in T1D. Positive results from the trial were presented at the Federation of Clinical Immunology Societies (FOCIS) Virtual Annual Meeting in June 2021 and European Association for the Study of Diabetes (EASD) 57th Annual Meeting in October 2021.
Fourth Quarter and Full Year 2021 Financial Highlights
Net cash used in operating activities of $55.8 million in 2021 compared to $77.0 million in 2020;
Net proceeds received from the issuance of common stock in January 2021 were $121.0 million;
Cash, cash equivalents, and short-term and long-term investments totaled $163.7 million as of December 31, 2021;
The Company anticipates that its cash, cash equivalents and short-term and long-term investments as of December 31, 2021 should enable the Company to fund operations well into 2023, assuming the Company’s programs advance as currently contemplated; and
The Company’s non-core businesses continued to generate increased revenues and profitability.
Fourth Quarter 2021 Financial Results Compared to Prior Year Period
For the quarter ended December 31, 2021, R&D expenses increased $2.3 million, or 22%, from the quarter ended December 31, 2020. This was primarily the result of an increase in salaries, benefits, and other personnel costs of $1.4 million and an increase in contract research organization costs and lab supplies of $0.8 million due primarily to the advancement of the Company’s clinical and preclinical programs. Selling, general and administrative (SG&A) expenses decreased $13.3 million, or 44%, due primarily to a noncash $11.4 million loss on a settlement agreement in the prior year as well as decreased salary, benefit and other personnel costs, including noncash share-based compensation expenses attributable to equity grants made in the first quarter of 2020. Net loss from continuing operations was $25.0 million, or $(0.13) per share for the quarter ended December 31, 2021, of which $5.0 million was for noncash charges, compared to net loss from continuing operations in the prior year’s fourth quarter of $39.7 million, or $(0.22) per share, of which $19.7 million was for noncash charges in 2020.
Total revenues increased $4.9 million, or 25%, over the quarter ended December 31, 2020. This was primarily the result of product and service revenues generated by Trans Ova and Exemplar, which increased $5.8 million. This increase was due to higher customer demand for Trans Ova’s products and services as a result of stronger beef and dairy industries in the current year and a change in pricing structure with certain customers, as well as increased services provided by Exemplar to new and existing customers. Collaboration and licensing revenues decreased $0.8 million primarily due to a decrease in the recognition of previously deferred revenue in the current period resulting from fewer services being performed pursuant to the Company’s historical collaboration agreements.
Full Year 2021 Financial Results Compared to Prior Year Period
For the year ended December 31, 2021, R&D expenses increased $8.5 million, or 20%, over the prior year. This was the result of an increase in contract research organization costs and lab supplies of $6.7 million due primarily to the advancement of the Company’s clinical and preclinical programs. SG&A expenses decreased $17.6 million, or 19%, from the prior year due primarily to certain costs incurred in 2020 that were not recurring in 2021 and a reduction in salary, benefit and other personnel costs. Costs incurred in 2020 that did not recur in 2021 included $13.9 million for certain legal settlements. Salaries, benefits, and other personnel costs decreased $4.9 million in 2021 primarily due (i) to reduced headcount as the Company scaled down its corporate functions to support a more streamlined organization and (ii) reduced stock compensation costs for previously granted awards that became fully vested in early 2021. Net loss from continuing operations for the year ended December 31, 2021 was $96.8 million, or $(0.49) per share, of which $29.4 million was for noncash charges compared to net loss from continuing operations of $103.8 million in the prior year, or $(0.62) per share, of which $45.9 million was for noncash charges in 2020.
Total revenues were comparable year-over-year, with increased revenues generated by Trans Ova and Exemplar being offset by a decrease in collaboration and licensing revenue as a result of the Company’s changing business. The increase in Trans Ova and Exemplar revenues was $21.6 million. This increase was primarily due to higher customer demand for Trans Ova’s products and services as a result of stronger beef and dairy industries in the current year, as well as increased services provided by Exemplar to new and existing customers combined with a change in pricing structure with certain customers for both Trans Ova and Exemplar. Collaboration and licensing revenues decreased $20.7 million as the Company accelerated the recognition of previously deferred revenue in the prior period upon the mutual termination of two of its collaboration agreements in 2020. Gross margin on products and services improved as a result of the increased revenues, the change in pricing structure for certain customers, and operational efficiencies that have been gained through reductions in workforce and improved inventory management.